Calif. Supreme Court to Rule on Termination Without Cause

For a moment in June, the tide seemed to turn in favor of physicians in their efforts to infuse some fairness into the managed care deselection process. A California Court of Appeals had ruled that health maintenance organizations must provide a fair hearing to doctors before terminating them under the "without cause" provisions contained in most contracts (PT August).

Recognizing that the decision would significantly affect the delivery of health care and the economics of medical practice, however, the California Supreme Court in July agreed to hear the case of Louis E. Potvin, M.D., v. Metropolitan Life Insurance Company. The groundbreaking lower court ruling left the managed care industry apprehensive for a moment that a flood of hearings and litigation would hinder their ability to alter staffing levels based on the bottom line. Under California law, once the Supreme Court grants review, the lower court ruling loses any legal effect.

Physician Against Physician

With the high court ready to decide the issue, the battle over due process rights in connection with terminations is no longer just a controversy that divides physicians and managed care proponents, for it has now also become an internecine struggle that pits physicians against physicians. Based on documents obtained by Psychiatric Times, groups of physicians have taken opposite sides in the contest, based on the nature of the interests they have at stake in the growing managed care environment.

What started out as a solitary quest for justice by a veteran Orange County, Calif., obstetrician who was terminated without cause from two HMO networks operated by Metropolitan Life Insurance, has now blossomed into a major policy debate that has physician groups lining up to plead their global causes to the Supreme Court. And though Louis Edgar Potvin, M.D., a former president of the Orange County Medical Association, never expected to become the standard bearer for the medical profession, the case has grown beyond a mere effort by one physician to restore his practice and life savings; it has become symbolic of the increasingly heated debate that has enveloped the delivery of health care.

In an ironic twist, ultimately it will be the physician groups lining up to file their amicus curiae briefs with the Supreme Court who will be the only ones with anything to gain. Suffering from pancreatic cancer, Potvin died as this issue of Psychiatric Times went to press. In the memorial service, colleagues described him as a man "who ennobled our profession and ennobled us by association," "who was of the old school, and cared deeply about his patients," "who worked for justice in HMOs, but did not condemn the people in them." Potvin's legacy, then, will be the case that forever bears his name.